One of the most important carbon cycle perturbations following the end-Permian mass extinction event straddles the Smithian-Spathian boundary (SSB) (Olenekian, Early Triassic). This anomaly is characterized by a prominent positive carbon isotope excursion known from Tethyan marine rocks. Its global significance is established here by a new high paleolatitude record (Spitsbergen). Paleontological evidence, such as Boreal palynological data (Barents Sea, Norway) and global patterns of ammonoid distribution, indicates a synchronous major change in terrestrial and marine ecosystems near the SSB. The reestablishment of highly diverse plant ecosystems, including the rise of woody gymnosperms and decline of the formerly dominating lycopods, is interpreted as an effect of a major climate change. This hypothesis is supported by modeling of ammonoid paleobiogeography, the distribution patterns of which are interpreted as a proxy for sea surface temperatures (SST). The latest Smithian thus appears to have been a time of a warm and equable climate as expressed by an almost flat pole to equator SST gradient. In contrast, the steep Spathian SST gradient suggests latitudinally differentiated climatic conditions. We propose that this drastic climate change and the global carbon cycle perturbation were triggered by a massive end-Smithian CO2 injection. The SSB event could therefore represent one of the causes for stepwise and delayed recovery of marine and terrestrial biotas in the wake of the end-Permian biotic crisis.